Tag Archives: American Trucking Association

Running a business of your own is basically part of the American dream. There’s nothing more exciting than the thought of being your own boss and being able to make a lot of money. You’d like to run your own business, but you aren’t sure what kind you’d like own. You don’t want to sell things to other people, and you don’t want to go into the food or service industry. You’ve considered turn-key operations where the money makes itself, but you think you’d want something that’s more hands on.

If you want to try something different, running a trucking business could be the new venture you’re looking for.

A profitable industry

It’s been known that the ability to drive a fleet vehicle is a coveted job skill. Being able to drive a big rig can make you money, but owning a company that sends out the rigs is even more profitable.

If you’re looking for something that’s profitable, the trucking industry could be what you need.

It’s estimated that the industry itself generates around $650 billion in revenue every year, and that number is only expected to grow.

There’s money to be made in the industry, but only if you’re a good fit for the job.

What to consider before running a trucking business

Trucking is a growing and popular industry, but that doesn’t mean that just anyone can succeed in it.

Almost any budding entrepreneur thinks that they would be perfect for it, but a lot goes into being able to manage a fleet.

Aside from having a good business sense you need to have management skills, the ability to problem solve, and the ability to analyze data.

You’re going to be wearing a lot of hats when you’re running your business, and you need to be prepared to handle the workload.

If you want your business to be successful, there are a few things you need to do.

Estimate your costs accurately

Starting a trucking business isn’t as simple as buying a few fleet vehicles and getting some drivers.

Running a trucking business costs a lot of money that goes beyond the price of the trucks and the employee’s salaries.

Maintenance can cost a significant amount of money. Trucks need to be examined frequently to make sure that they’re running well.

Some companies take maintenance so seriously that they’ll have a mechanic look at each truck when it comes back from a delivery.

There’s also the cost of employee benefits and insurance. Both vehicles and employees need to be insured for a variety of things.

On top of this, there’s rental costs for your lot and business, and other costs are bound to pop up along the way.

Talk to a financial adviser so you can determine what you’ll need money wise to start your business.

This is important because you’ll need to…

Get a good loan

When you’re discussing your budget with your financial adviser, make sure to talk about the loan amount they think is best for you.

Since you’re getting a loan, it’s also important to make sure that you look like a great potential investment to your lender.

Take some time to bring up your credit score before you apply. Also, consider asking someone with stellar credit to co-sign your loan if you’re worried about your score.

Consider subcontracting truck drivers

Now that you’ve spent some time considering finances, you may be wondering how you can afford to pay your employees.

If you want to save money on operating costs and still have good drivers, you may want to consider using subcontracted truck drivers.

These truck drivers are hired per contract for specific jobs, they’ll only work when you need them to.

This can be the ideal set up for people that are interested in running a trucking business but want to start their company with less capital.

Data and software are your best friends

When people think about running a trucking business they usually don’t think about software. But the right kind of software and data collection methods can ensure that you’re running your business in the best way possible.

The right kind of software can make managing finances a breeze. You’ll have one place where you can keep all of your paid and outstanding invoices, employee payment information, account balances, and more.

Collecting data from trips is equally important.

Find out how often drivers are stopping to fill up, and how much fuel costs them in each state. See which routes are the most efficient and which ones seem to take more time.

Having all of this data on hand could help you find more efficient routes for your drivers or could help save you money on fuel.

Perform maintenance frequently

Remember how we mentioned that some companies will perform routine maintenance on every truck after it gets back from a delivery?

That may seem like too much, but it helps ensure that all fleet vehicles are in top running shape.

When you’re running a trucking business, it’s important to keep in mind how much wear and tear can occur on a running big rig.

Some of these truck drivers are running their vehicles non-stop for hours at a time while they travel across the country. Even trucking businesses that stay local can put some serious miles on their rigs.

A loose belt or low oil may go unnoticed in a regular car for a few weeks or even months depending on how much it’s driven. All it takes is one long trip for damage to become apparent in a big rig.

Aside from having professionals routinely handle truck upkeep, it can be helpful to train your truck drivers in simple maintenance. Their dashboard can only tell them so much about the state of their vehicle.

There are rules about hauling certain kinds of materials, equipment usage, and nearly every aspect of trucking you can think of.

The trucking industry on average produces 5,360 fatalities and 142,000 injuries each year. When you’re running a trucking business safety should be your number one priority above all else.

Highway and driver safety clearly is a priority. Your truck drivers need to observe safe driving practices when they’re on the road. Drivers that constantly take shortcuts, speed, or drive aggressively shouldn’t be a part of your company.

Driver safety is only a small part of the issue. There are other hazards associated with trucking people can forget about.

Unsafe loading and unloading practices have the potential to harm employees or damage products. Drivers should also be thoroughly trained on hauling hazardous materials if you choose to go into that industry niche.

Find good clients

The key to running a trucking business is to have a lot of clients you can rely on.

Some owners lull themselves into a state of false security once they land their first big contract. But it’s important to remember that the 6 or 7 figure contract you have today may not be there tomorrow.

Even if you have an excellent client you think will be with you for decades, you still need a solid business development plan to ensure that you’re bringing in new work.

If you can’t devote yourself to finding new clients you need to hire someone that can handle sales. Look for someone that specializes in the trucking industry and may already have some connections.

Bring on good talent

Running a trucking business will be hard if your drivers have a reputation for being late or rude to clients.

Your truckers are going to represent your business on each trip, and you want to make sure you hire people that are up for the task.

There’s nothing wrong with hiring people that are new to the industry, but you may want a seasoned vet or two on your team in the beginning.

They’ll know the ins and outs of the industry, and they could even serve as a mentor for newer drivers.

Don’t risk bringing on someone with a bad driving history. They may have their CDL, but you should look into their personal background.

If they have speeding tickets, road rage incidents, or any charges involving drugs or alcohol, they probably won’t be good for your business.

Wrapping up

As you can see, running a trucking business requires a lot of work. You’ll need a good mix of reliable employees, the right equipment, and a mind for business if you want to succeed.

Do any seasoned trucking business owners have advice for people new to the industry? Tell us about it in our comments section!

If you have questions about trucking services, contact us so we can answer them.

There’s more to tires than just the type or retreading. Other considerations include road matters and even matters of balancing and alignment. Even so, ask some fleet managers and they will tell you that tire balancing and alignment is not at the top of their list, but should it be?

The fact is this: Alignment and balancing are best used as repair tools, not diagnostic tools. Only one thing will tell you when an alignment is needed: The tires. So what is the final answer on proper balancing and alignment?

Does it Matter?

You may get wildly different answers on the virtues of balancing and alignment depending on whom you ask. Fleets are either hot or cold on the matter. Most fleet managers will tell you that they balance only steer tires, and then only when they are new.

Conversely, those who don’t feel the need to balance are under the assumption that today’s top radial tires are of good enough quality that they shouldn’t need to be balanced if they are mounted and installed correctly.

Where alignment is concerned, the most common course you hear is that they align the truck before putting it into service and then only as needed throughout the full lifecycle of the vehicle. The problem is, that may be never. But is that a bad thing?

What’s the Problem?

Those that balance the steer tires typically use around 16 ounces of weight to balance them. If the tire requires more than that, it may be time to deflate the tire, break the bead, completely rotate on the trim and then go for a do-over. Still encountering problems? If so, it might be time to send that tire right back to the manufacturer.

But does this mean every time a truck driver complains about a vibration you should automatically pull and balance the wheels? Not necessarily. Keep in mind that if the tires are wearing properly and now showing any visible signs of damage, it may not be a balancing problem.

Imagine if you put weight on a tire to address a balancing issue, but the problem is actually along the driveline. You could be inadvertently swiping an even bigger problem right under the rug.

Is it Necessary?

The other side of the argument asks if balancing is even necessary. Many believe you can eliminate the need for balancing tires just by making sure they are installed properly to begin with. In this scenario, experts recommend that you inspect the rims with a runout gauge before actually mounting the tire. Always ensure they are within the manufacturer’s recommended tolerance level.

You have to make sure the mounted tire is checked for concentric mounting. Do this by verifying the gap between the rim flange and the bead seating ring. This gap should be the same all the way around and on both sides of the tire.

Looking for guidelines on inspection and mounting procedures? Check out the American Trucking Association’s Technology & Maintenance Council Recommended Practice library, section RP 214D for comprehensive inspection and mounting procedures.

When in Need

The moral of the story is that the truck drivers will know when the vehicle isn’t behaving properly. But even in situations where information isn’t coming in, tires should always be examined at designated preventative maintenance intervals. Look for signs of alignment-related wear, which includes feathering or excess opposite shoulder wear.

And if you are having a hard time justifying the maintenance need, consider the economic one. According to a recent energy group survey, tire balance is documented to save as much as 2.2% in fuel savings. The fact is, when you are trying to keep costs low, every percentage counts.

Making sure your tires are all properly headed in the right direction certainly isn’t going to hurt fuel economy. So in the end, it might not hurt to keep balancing and alignment in mind.

A new round of lobbying has begun to increase the weight limit imposed on commercial trucks by the federal government. The current limit sits at 80,000 pounds, but should it be raised?

Rep. Reid Ribble (R-WI) has introduced the Safe, Flexible and Efficient (SAFE) Trucking Act, which would allow individual states to increase the federal vehicle limit to 91,000 pounds, should they so choose. Would the passage and Presidential signature of this bill mean fewer trucks would be moving the same amount of cargo, and thus be safer?

Who Supports It?

Introduction of the bill was quickly applauded by at least six major associations that represent the interests of shippers. Initially, trucking-specific groups were silent on its passage.

Now the National Private Truck Council (NPTC) has thrown their lobbying weight behind the bill, as well. The NPTC is a member of the Coalition for Transportation, an association that represents some 600 private fleets.

The NPTC contends that the SAFE Act will provide fleets with the flexibility they need to safely address highway capacity issues. Letting carriers run heavier, six-axle trucks would create more options for fleet managers.

Ribble has said that he intends to introduce the SAFE Act as an amendment to the long-term highway bill. This means that the House Transportation and Infrastructure Committee can begin marking up the bill and allow discussions on associates amendments and riders.

In his defense of the bill, Ribble stated that there is a “fairly broad coalition of members who support it from both parties.” He went on to state that he expects the act to be fleshed out once the highway bill enters the conference process.

Who’s Against It?

So is anyone against the bill. As it turns out, the railroad lobby has come out against the proposal. Railroad interests fear a hit to their business model if more freight travels over interstate highways.

Railroad interests have also been joined by the Truckload Carriers Association (TCA), who sent a letter to Ribble on September 16, arguing strongly against the legislation. In the letter the TCA states that it opposed the measure because “it would only benefit a minority of the industry.”

The Trucking Alliance, which is a coalition of trucking companies that lobby for safety improvements, also decries the bill. As they put it, the bill “would drive up operating costs, drive down truck driver wages, and curtail investments in safety technologies.” It’s notable that the American Trucking Association has had no comment on the matter.

What Will It Do?

As Ribble puts it, the bill would allow the freight shipping industry to be more efficient. He argues that a heavier truck pulls more freight, in turn keeping more trucks off the road. This would result in less wear and tear on pavement and create new opportunities to improve safety on bridges and roads.

It is important to note that this bill will not actually mandate anything. All it does is allow state governments to permit truck combinations up to 91,000 pounds used on interstate highways within their states. State agencies would still be allowed to limit or even prohibit the use of vehicles of this size and weight.

The bill would essentially allow vehicles with a sixth axle to up their freight weight limit. But would adding up to 11,000 pounds to the gross cargo weight limit be safe? According to Ribble, the bill was written using data from the Department of Transportation (DOT) safety and road wear data. He said they want to ensure truck stopping times are as good or better than current stopping times.

But could this change create unintended consequences in the area of fleet equipment and safety management? Only time will tell.

It’s true that 2015 has been a year of opportunities for trucking. But just as we’re talking about an industry hitting the $700 billion revenue target, headwinds remain.

Freight demand is higher than ever, yet trucking is facing challenges on several fronts. Increased recruiting expenses, truck purchase and maintenance costs, regulatory burdens, and lost productivity are all stressing forces on fleets. Today we’re going to take a closer look at each area trucking needs to focus on as we move into the latter half of the year.

Recruiting New People

We’ve been talking about it nearly non-stop, and there’s a reason why. The truck driver shortage is real. According to the most recent numbers from the American Trucking Association (ATA), the nation needs roughly 96,000 truck drivers per year, just to keep up with demand.

If these continue as they are now, expect that number to swell to 240,000 by 2022. While there are a number of factors contributing to the shortage, overall it remains a vexing problem.

Budgets for fleet recruiting departments have also risen. As the employment situation begins to get direr, carriers are increasing their sign-on bonuses and mileage pay as they struggle to put truck drivers in a cab.

Regulatory Burdens

Fiscal pressures are increased when regulations tighten. Fleets have had to deal with a number of changes in the Hours-of-Service (HOS) model. Each change brings a shift in productivity and an adjustment to the schedule.

Several other regulatory changes might also further constrain trucking. The Environmental Protection Agency (EPA) and National Highway Transportation Safety Administration (NHTSA) are set to release new standards aimed at reducing fuel consumption in Class 8 trucks by 29 percent, between the 2014 and 2018 model years.

This change could result in the cost of buying and maintaining a new rig increasing exponentially. As things get more complicated under the hood, expect them to get more complicated in the wallet.

Lost Productivity

As HOS and other regulations have worked their way through the system, driver and asset productivity have fallen. After all, fleets must view both their equipment and their truck drivers’ time as perishable commodities.

Although HOS has been placed on ice by a Republican Congress, like any high-investment, low-margin machine, big rigs and trailers need to be kept in continual productive motion. In order to keep the bottom line from feeling any negative impacts, fleet managers are segmenting their drivers’ time.

Another major productivity problem is in wait time. As shippers get squeezed due to a lack of capacity, truck drivers often find themselves spending a disproportionate amount of time waiting at loading docks.

Rail Problems

Trucking isn’t the only industry grappling with a rapid increase in freight volumes. Service recovery on the rail lines has also stalled. Intermodal, carload, and grain movements have all seen year-over-year growth in the double digits.

While some may be quick to think the problem lies in the rail itself, this isn’t so. Railroads continued to see heavy investment through the recession, and today the investment activity going into maintaining the system is still at record levels.

The problem with railroads is one trucking is quite familiar with. There simply aren’t enough crew members out there to fill an employment void. Additionally, new EPA regulations mean there will be only one locomotive manufacturer until 2017, which could squeeze supply.

Capacity Crisis

The fact is, the market is at a capacity tipping point. The strength of demand doesn’t look to ease anytime soon. At best, seasonal peaks and/or unknown events could cause series of capacity crises.

Furthermore, contract rates are moving up. Total shipping costs are expected to rise further in 2016. To add insult to injury, another set of regulations is likely to hit in 2016, which could further muddy the picture.

It’s no secret that despite strong gains, trucking has some challenges to face. How well it’s able to meet those challenges depends on the actions of a number of people, from fleet managers to politicians. What the future holds is anybody’s guess.

It’s no secret that there is a shortage of qualified truck drivers in the United States. Truck drivers are retiring, drivers are choosing local driving positions over being on the road for long periods of time, and stricter regulations are taking many truck drivers out of the running for jobs.

Economic Impact

With fewer drivers to move loads from manufacturers to stores, businesses are having to wait longer for the shipments they need. This causes frustration for the stores, the manufacturers and the customers. This frustration is expected to increase as we enter the holiday shopping season.

Another issue is that trucking companies are having to raise the rates they charge for hauling goods. The increase in shipping costs is passed on to the customers who purchase the goods. According to a report by DAT Solutions, a company that analyzes and provides data to the transportation industry, the rate per mile that companies charge to haul freight has increased about eight percent from August 2014 to August 2015. It is now at about $1.80 per mile for long-term contracts between manufacturers and shippers.

Some trucking companies are going out of business because they cannot afford to pay the drivers as much as it takes to keep them from leaving for better opportunities. Changes in the hours-of-service regulations have meant that trucking companies must hire more drivers to move the same amount of freight. Smaller companies who are unable to increase freight prices often have trouble keeping up with the costs of driver pay and benefits, forcing them to close their doors altogether.

What Trucking Companies are Doing

Although there are some causes of the truck driver shortage that are out of the hands of companies, most companies are taking steps to keep the drivers they have and attract new ones.

Pay increases are at the top of the list. Drivers know that the shortage of qualified drivers on the road makes them more valuable. They are also likely to switch companies when they see that they can get thousands of dollars in the form of a sign-on bonus.

Truck drivers are also looking for more time at home, and companies are generally obliging. More companies are offering drivers the ability to be at home several times each month. Some companies are even offering their drivers home time every week.

Partially due to the shortage of qualified drivers, the American Trucking Association is actively facilitating military veterans who are interested in becoming truck drivers in meeting their goals. In fact, the ATA committed to hiring at least 100,000 veterans between the end of 2014 and the end of 2016.

There are so many factors that affect the driver shortage in the United States that there are no easy solutions. It’s likely that drivers will keep retiring, with fewer qualified applicants to take their places. This likely means that the prices of goods will go up to compensate for the necessary increases in driver pay and benefits. The good news is that high pay is likely to attract more people who may not have previously considered truck driving as a career option, and the shortage will likely be reduced in time.